Global Macro: Funds Head Overseas to Flee U.S. Debt Uncertainty

Markets on Monday traded in a volatile range as the U.S. debt impasse pushed funds into foreign assets.

NEW YORK ( TheStreet) -- The U.S. dollar has been the main casualty of the recent government debacle.

As can be seen in the chart below of the USDCHF currency pair, the dollar and safe-haven Swiss franc have traded in a volatile range against each other.

The range-bound trade can be attributed to the genuine uncertainty that investors face right now. They know that once a deal is passed, the dollar will have a relief rally, catching those currently short in an unwanted squeeze position.

But until that point, no one wants to be long dollar either, due to uncertainty but also the general weakness caused by continued monetary stimulus from the Federal Reserve.